Kamat Hotels Reports Q2 FY26 Revenue Decline, Maintains Annual Guidance Amid Challenges

Kamat Hotels India Limited (KHIL) reported a challenging second quarter for the fiscal year 2026, with consolidated revenue declining 12% year-on-year to INR 75.00 crores. Despite the setback, the company remains optimistic about achieving its annual revenue target of INR 400.00 crores.

Financial Performance

The company's Q2 FY26 results showed significant pressure on profitability:

Metric	Q2 FY26	Y-o-Y Change
Revenue	INR 75.00 crores	-12%
EBITDA	INR 8.00 crores	-63%
EBITDA Margin	10.43%	Declined
Net Profit	-INR 0.30 crores	vs. INR 8.00 crores profit in Q2 FY25

For the first half of FY26, KHIL's performance remained relatively flat:

Metric	H1 FY26	Y-o-Y Change
Revenue	INR 158.00 crores	Flat
EBITDA	INR 26.00 crores	-28%

Factors Affecting Performance

Several factors contributed to the company's subdued performance in Q2 FY26:

Natural Calamities: Road washouts affected properties in Shimla and Manali, significantly impacting revenue.
Expansion Costs: Pre-opening expenses for five new hotels, adding 280 rooms, weighed on profitability.
Renovation Impact: Ongoing work at Orchid Pune affected MICE (Meetings, Incentives, Conferences, and Exhibitions) business.
Seasonal Weakness: Extended monsoon led to revenue drops in Mumbai and Maharashtra properties.

Operational Updates

Despite challenges, KHIL continued its expansion:

Now operates 24 properties with 2,100 rooms
Opened new hotels in Panchgani, Dwarka, Rishikesh, Porvorim (Goa), and Hyderabad
Bhavnagar property opening rescheduled to April due to owner-related delays

Management Commentary

Vishal Kamat, Executive Director of KHIL, expressed confidence in achieving the INR 400.00 crore annual revenue guidance, citing:

Strong Q3 wedding season bookings
Improved performance from previously opened hotels
Positive outlook for new properties, especially Hyderabad, expected to break even in its second month of operation

Future Outlook

The management remains optimistic about H2 FY26 performance, expecting:

Rebound in occupancy rates, particularly in established properties
Increased wedding-related business in Q3
Improved contribution from new and stabilizing properties

Corporate Actions

KHIL has withdrawn a pending merger proposal due to regulatory delays, aiming to remove uncertainty for investors. The company's current shareholding structure remains unchanged.

While the Q2 results present a challenging picture, KHIL's management expresses confidence in a strong second half, banking on seasonal trends and the performance of its expanded portfolio to meet annual targets.

Investors are advised to monitor the company's performance in the coming quarters to assess the realization of management's projections and the impact of recent expansions on overall financial health.

1 Day	5 Days	1 Month	6 Months	1 Year	5 Years
+0.59%	-1.06%	-18.12%	+3.91%	+10.05%	+571.38%

Kamat Hotels (India) Limited , a prominent player in the hospitality sector, has submitted its investor presentation for Q2 and H1 FY26 results to BSE and NSE. The company's financial performance for Q2 reflects challenges in a dynamic market environment, with a decline in revenue and profitability compared to the previous year.

Financial Highlights

Metric	Q2 FY26	Q2 FY25	Change
Operational Income	826.00	854.00	-3.30%
EBITDA	180.00	224.00	-19.60%
EBITDA Margin	21.79%	26.22%	-4.43%
PAT	39.00	82.00	-52.40%

For H1 FY26, the company reported:
- Operational income: INR 1,578.00 million
- EBITDA: INR 259.00 million
- PAT: INR 22.00 million

Company Overview

Kamat Hotels currently operates 24 properties with 2,100 keys across 9 states under 5 brands:

The Orchid
IRA by Orchid
Lotus Resorts
Fort Jadhav Gadh
Mahodadhi Palace

Expansion Plans

As part of its KHIL 3.0 strategy, the company has outlined expansion plans:

9 new properties with 700 keys in the pipeline
Aims to expand to 26 properties with 2,500 keys by FY26

Recent Launches

Kamat Hotels has recently launched properties in:

Panchgani
Rishivan
Hyderabad
Dwarka
Porvorim

Outlook

The decline in revenue and profitability compared to the same quarter last year indicates challenging market conditions for Kamat Hotels. The compression in EBITDA margin suggests increased operational pressures. However, the company's expansion plans and recent property launches demonstrate a focus on growth and market presence.

Stakeholders will be watching closely to see how Kamat Hotels navigates these challenges in the hospitality sector and implements strategies to improve its financial performance in the coming quarters, while executing its expansion plans.